Proposed expansion of Maine Med among nation’s largest

Maine Med has two parking garages on Congress Street. An expansion plan calls for razing the employee garage, right, for a new 270,000-square-foot building, and adding three floors to the visitor garage, left. Ben McCanna/Staff Photographer

Maine Medical Center’s proposed $512 million renovation would be one of the largest hospital expansions in the nation, and while hospital officials say the project is designed to improve the “patient experience,” competitive reasons also may be driving the proposal, experts say.

Many hospital expansions across the country are designed to reduce or eliminate double-occupancy rooms, as single rooms are increasingly expected by patients, said Mike Hargrave, a principal at Maryland-based Revista, which analyzes the real estate market for medical clients.

“This is one of the common threads we are seeing in these renovations,” Hargrave said. “There are many strategic considerations, and hospitals are trying to position themselves for long-term success.”

“Anyone doing any hospital renovations is building single rooms,” said Katherine Hempstead, a senior adviser at the Robert Wood Johnson Foundation, a New Jersey-based health care philanthropy. “It really has become the industry standard.”

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While the official capacity of Maine Med is 637 beds, the actual capacity is currently much lower, sometimes in the 580s or less, hospital officials said, because many patients are too sick to stay in a double room.

Meanwhile, Maine Med’s patient load has increased in recent years, from 36,296 admissions in fiscal year 2009-10 to 40,193 in 2015-16. On some days, the hospital is operating at close to maximum capacity, officials said.

If the expansion is completed as planned, Maine Med’s actual capacity would be closer to its official capacity of 637 beds, officials said. That’s because Maine Med would have many more single rooms for patients.

Maine Med needs state and local government approval before the project can move forward, including a Certificate of Need by the state. The project, which is scheduled to be completed by 2022, would be funded by a combination of reserves, financing and fundraising.

“This is all about providing the best patient care,” said Richard Petersen, president and CEO of Maine Med.

The expansion at Maine Med’s main campus would eliminate some of the 303 double-occupancy rooms in favor of single rooms, which offer benefits that may include improved health outcomes.

SINGLE ROOM MAY IMPROVE PATIENT HEALTH

Jeffrey Austin, vice president of government affairs for the Maine Hospital Association, said research points to improved health of patients who recover in single rooms. Patients are more comfortable and relaxed, and infections are more likely to be prevented in single rooms.

“The case for single occupancy is only getting stronger,” Austin said. “The original reason, and still primary reason, is clinical. Patient outcomes improve with single occupancy.”

Single rooms were built for patients at Mercy Hospital’s new Fore River complex, and Mercy does not have any remaining double rooms at its two Portland locations. In MaineGeneral Medical Center’s $312 million construction project in Augusta, which was completed in 2013, 192 single rooms were built.

Revista has maintained a database of all significant hospital construction projects across the nation since 2014, and the $512 million Maine Med expansion would be the 14th most expensive of the 578 projects tracked. In total, hospitals are increasing square footage by 1.5 percent in 2016 and a projected 1.9 percent in 2017.

Maine Med’s expansion would increase the square footage at its main campus by about 25 percent.

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Hargrave said patients increasingly shop for health services, so having double rooms is a competitive disadvantage in addition to the medical reasons for single rooms.

“The days when you had the regional hospital and patients just went to their local hospital for care are gone,” Hargrave said. “It’s a much more competitive environment than it used to be.”

The project also would be the largest in Maine Med’s history. The hospital has expanded numerous times since 1874, most recently adding operating rooms in 2015.

The 300,000-square-foot expansion at Maine Med’s main campus in the West End would eliminate some of the 303 double-occupancy inpatient rooms. Officials say it’s unclear how many would be eliminated or consolidated to single rooms.

One of the reasons driving the need for single rooms is because patients who stay overnight at hospitals often have more severe conditions than in years past, because more patients are being treated as outpatients for conditions that used to require an overnight stay.

So those who do spend the night need more complicated treatments and are more likely to require single rooms, officials said. The single rooms are also more accommodating for visiting family members.

“This is all good stuff for patients,” said Emily Brostek, executive director of Consumers for Affordable Health Care, an Augusta-based health advocacy group. “What impact does this have on health care costs down the road? That’s the thing to watch out for.”

Petersen has estimated that the impact on Maine Med’s health care costs would be about 1 percent, although that’s difficult to predict because of the many factors that affect those costs. For instance, health care prices are affected by government reimbursements, negotiated costs with health insurance companies and other factors.

“We don’t believe that (the expansion) will cause costs to spike,” Petersen said.

Hargrave said he doesn’t see much correlation with health care expansions and the cost of health care, in part because the expansions also tend to help hospitals generate revenue.

The expansion would include 20 new operating rooms, relocation of the helipad, a new parking garage, an addition to the visiting parking garage and off-site expansion of outpatient services. An employee parking garage built in 1972 would be demolished to make way for the cornerstone of the project, a 270,000-square-foot building that would include the operating rooms, inpatient rooms and the new front entrance.

ATTRACTING MORE SPECIALIZED SURGERIES

Hempstead said the new operating rooms could be a revenue generator, as specialized surgeries are reimbursed handsomely, especially when patients have private insurance.

“In a small state like Maine, Maine Med could be the sole source for a lot of profitable procedures,” Hempstead said. “They can catch the bouquet of the privately insured patients who are coming in for complicated operations.”

Maine Med officials said many specialized operations are performed at the Portland hospital, and they expect more patients from outlying areas will be referred to the hospital for such procedures in future years.

Nancy Kane, professor of management at Harvard University’s T.H. Chan School of Public Health, said she’s concerned about how the patient trends will affect rural hospitals.

“One of the big questions for me is,” Kane said, “if more patients are coming from rural Maine to Maine Med, does that mean that rural hospital beds are increasingly unoccupied? What does that imply for the sustainability of small rural hospitals in Maine?”